Ribbon Communications Inc.

Ladies and gentlemen, greetings and welcome to the Ribbon Communication Third Quarter 2024 Financial Results Conference Call. At this time, all participant lines are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star and zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Joni Roberts, Chief Marketing Officer. Please go ahead.

Good afternoon and welcome to Ribbon's Third Quarter 2024 Financial Results Conference Call. I'm Joni Roberts, Chief Marketing Officer at Ribbon Communications. Also on the call today, Bruce McCullen, Ribbon's Chief Executive Officer, and John Townsend, who will shortly assume the role of Ribbon's Chief Financial Officer. Today's call is being webcast live and will be archived on the Investors Relations section of our website, rbbn.com, where both our press release and supplemental slides are currently available. Certain matters we'll be discussing today, including the business outlook and financial projections for fourth quarter of 2024 and beyond, are forward-looking statements. Such statements are subject to the risks and uncertainties that cause actual results to differ materially from those contained in these forward-looking statements. These risks and uncertainties are discussed in our documents filed with the SEC, including our most recent form, 10K. I refer you to our Safe Harbor Statement, including the supplemental financial information posted on our website. In addition, we'll present non-GAAP financial information on this call. Reconciliation to the applicable GAAP measure are included in the earnings press release we issued earlier today, as well as the supplemental financial information we prepared for this conference call, which again are both available on the Investor Relations section of our website. And now I'd like to turn it over to Bruce. Bruce?

Great. Thanks, Joni. Good afternoon, everyone, and thanks for joining us today to discuss our Q3 results and outlook for the rest of the year. First, as many of you know, Mick Lopez announced his plan to retire and will be with us through the end of the month. As I stated before, Mick has been instrumental in maturing the operations of the company and accomplishing multiple strategic initiatives. Mick, thank you for your leadership and contributions to Ribbon, and all the best to you in your retirement. I'd now like to welcome Jon Townsend, who is joining us as Chief Financial Officer, effective November 1st. Jon is a proven financial leader with an impressive career that spans over 30 years, leading large, complex financial organizations for several of the industry's largest service providers in multiple countries. Given our focus in this area and the continued gains we're making, I'm really looking forward to the insight Jon will bring us. He'll be available in our Q&A session this afternoon. Now, on to Q3 results. I'm very pleased with our performance in the quarter, highlighted by the return to growth in our cloud and edge business. As we indicated on our last earnings call, we have a number of tailwinds that will support and underpin this business for years to come, and will have a positive effect on the overall margins for the company. And while IP Optical Network sales were lower year over year this quarter, following the suspension of product sales to Eastern Europe beginning last quarter, we are growing in other areas. In fact, we're having a very strong second half in the U.S. where our cross-sell strategy is working well, and we have numerous projects focused on expanding rural internet availability and capacity. We also continue to see more opportunities related to competitive shifts in the market, where customers are assessing their options to replace incumbent suppliers, and we have very good opportunities to gain market share. One of the most notable areas of growth for us across both businesses is the federal and defense industry. Year to date, sales have grown 60% as compared to 2023, and accounted for 13% of overall sales so far this year. Our portfolio of secure communication applications and network infrastructure is a great fit for this important market. In the U.S. defense segment, we have developed a very strong position with multiple branches of the armed forces, as they replace legacy systems with modern cloud-based voice solutions that provide the security and survivability needed to carry out their combat and peacekeeping missions. And in Europe, our secure IP and optical data networking platforms are widely deployed in countries such as Israel, Switzerland, and Finland. Our combined portfolio has brought applicability across many more federal agencies and countries, creating opportunity for significant further growth. In the third quarter, overall sales were $210 million, increasing .5% year over year and 9% quarter over quarter, led by the growth in cloud and edge. Earnings were once again very solid, and at the top end of our guidance, with adjusted non-GAAP EBITDA of $30 million, non-GAAP gross margin of 55% exceeded expectations and was at the high end of guidance, with a positive mix of product sales and good execution from our professional services team. Non-GAAP operating expenses were $90 million in the quarter, up slightly year over year, mostly due to mid-year employee compensation adjustments. Year to date, profitability for the company has increased $15 million, or 32%, on an adjusted EBITDA basis, as compared to 2023. Trailing 12-month adjusted EBITDA is now $106 million. Now, a little more detail on our operating segments. In the cloud and edge business, as expected, sales to Verizon increased substantially in the quarter, reaching 15% of overall company sales. The initial three-year phase of the voice network modernization project we announced earlier this year is fully underway, and the combined Verizon and Ribbon team are executing very well. Our revenue run rate is now exceeding $100 million per year with this key customer, and is expected to grow in 2025. In the US federal market, we announced an important project win to modernize and secure the US federal soft switch backbone with our -the-art voice communication infrastructure. We now have deployments in four branches of the US military as we continue to expand our in defense networks across the globe. One of the key drivers behind the improved gross margin in this quarter was the increase in SBC sales and the greater software mix. This is one of the best quarters for SBC sales that we've had in several years, up more than 60% from the third quarter last year. This included sales across a number of markets, including US and international service providers, US federal, and a number of large enterprise customers. Also, as I mentioned earlier, we're in active discussion with a number of customers regarding the replacement of Microsoft MetaSwitch platforms. We have a large funnel of opportunities, and we've closed several initial deals this quarter. We also closed a sizable project with our partner, JSC, to provide a full IMS voice platform leveraging our SBC and policy solutions along with their IMS core. This is a relatively new area for us and has the potential for us to gain share in a portion of the market where we've not fully addressed in the past. Overall, cloud and edge revenue in the third quarter was $128 million, up 11% year over year and 16% quarter over quarter. Non-GAAP gross margin neared an all-time high at 68%, and Non-GAAP adjusted EBITDA contribution to the quarter to $38 million, also near an all-time high. Booked a bill was very strong at over 1.4 times with an increasing backlog associated with network transformation projects. In summary, this was a great quarter for our cloud and edge business and sets us up for an even stronger performance in the fourth quarter. In our IP optical segment, the highlight of the quarter was certainly the increased business in the US. As mentioned in our last earnings call, we had very good backlog entering the quarter in the US market, particularly with regional and rural broadband providers. This resulted in our strongest quarter ever in the US with revenue increasing more than 100% both quarter over quarter and year over year and accounted for more than 20% of IP optical sales. We expect the momentum in the US to continue in the fourth quarter across a number of use cases and customers, including US rural and regional broadband, middle mile transport, TDM circuit emulation with an increasing number of service providers, as well as critical infrastructure providers such as American Electric Power. And we anticipate further growth in 2025 as larger service providers accelerate their modernization of the TDM infrastructure and leverage our IP routing technology. IP optical sales to operators in India, including BARTY and Vodafone Idea, increased 16% quarter over quarter but are tracking a little below last year's level. We continue to expect the fourth quarter to be the best of the year in this region with the second half approximately 30% higher than the first half of the year. This is in large part due to the renewed investment being made by Vodafone Idea to upgrade their network infrastructure. In Europe, IP optical sales in the quarter increased 15% year over year and are up 17% year to date. Central Europe continues to be our strongest region, including Germany, Austria, and Switzerland, where we have a good mix of critical infrastructure, service provider, and defense customers supporting the business. We also have a good pipeline of opportunities with service providers in Southern Europe, including Italy and Spain. Finally, from an innovation perspective, at the recent Next Generation Optical Networking event in Paris, we demonstrated the industry's first 400 gig ZR Plus module that supports field upgradability to 800 gig ZR Plus. This enables operators to cost effectively support both metro and long-haul transport on a single module, enhancing performance and cost efficiencies with an open, interoperable architecture. Our new Apollo 9408 compact modular platform provides industry-leading density with 25.6 terabits per two rack units and an impressive low power consumption of less than 0.07 watts per gigabit. It's a great platform, ideally suited for growing data center demand. From a financial perspective, IP optical revenue in the third quarter was $82 million, down -over-year and flat to the second quarter. But excluding sales to Eastern Europe, revenue from all of the customers was up 4% -over-year. As expected, gross margins were lower at 36% as a result of the change in mix. Booked to bill was 1.0 times in the quarter after adjustments associated with Eastern Europe. Non-GAAP adjusted EBITDA for IP optical was negative $8 million, down $4 million from the prior year. -to-date adjusted EBITDA is $21 million improved over the first three quarters of last year. Now let me wrap up on our third quarter results with a few key operational metrics that Nick would normally comment on. John will pick this up next quarter. Cash from operations was a negative $15 million, and we ended the quarter with cash and cash equivalents of $49 million. This was lower than anticipated due to approximately $25 million of accounts receivable collections expected at the end of September that were delayed into October, increasing our quarter end AR by approximately $40 million. More than half this amount was already received in the first two weeks of October, and we expect positive cash generation this quarter, with AR staying at a similar level due to significant increase in shipments this quarter. Interest expense in the quarter was $10 million, reflecting our new credit facility, but we benefit from the 50 basis points SOFR rate reduction recently implemented. We also invested $7 million this quarter as we prepared to relocate an R&D facility and $2 million in typical CAPEX investment. We now estimate a non-GAAP tax rate for the full year of approximately 40%, given shifts in regional profit and loss contributions. Now a few comments on the fourth quarter, and I'll look for 2025. The operating environment continues to improve and presents an excellent opportunity for us to maintain our momentum, growing revenue and profitability. Specific trends influencing our business include the following key areas. First, network modernization to drive down cost and retire obsolete infrastructure is a key factor behind the increasing investment from service providers, enterprises, and federal agencies to upgrade their voice communication infrastructure. Legacy TDM and copper networks are increasingly expensive to support, and programs such as the Verizon Voice Core Modernization Project are clear evidence of the priority now being placed on this part of the network. We have a growing number of sizable projects with other large service providers that will drive further growth in our cloud and edge secure communications business in 2025 and in years to come. Second, as I mentioned earlier, we're having very good success in federal and defense sectors in the US and Europe. Mission critical applications that rely on highly secure networks that are always on and never fail. This is an area where ribbon really differentiates from the competition. Third, there continues to be substantial investment to improve internet availability and performance for underserved segments of the broadband market. This is an area where we're really executing well on our cross-sell strategy, and the upcoming US BEE program will further increase funding across the entire ecosystem. And finally, the shifting competitive environment is creating further opportunity for ribbon to win new accounts across multiple regions. In the IP optical space, the merger of Nokia and InfoNara introduces supply chain concerns that we expect to capitalize on, and Microsoft has generated significant uncertainty around the Metaswitch install base that introduces substantial replacement opportunities for us. The focus we have on cross-selling the entire portfolio to our broad base of customers continues to generate results, as highlighted by the success we're having with US rural broadband providers. And the integration of our Neptune IP router with our voice transformation portfolio has opened doors across the entire US service provider landscape to modernize the aging voice network leveraging our IP routing technology. While it's still early, we expect the combination of these opportunities to enable us to grow revenue in 2025 in the -single-digit range, even after accounting for the reduction in sales to Eastern Europe. We do not anticipate significant changes in operating expenses, enabling the majority of the incremental margin to contribute directly to earnings, where we expect to grow at a double-digit rate. In the fourth quarter, we continue to expect an excellent finish to the year with sequential growth in both businesses. Voice modernization programs with Verizon and multiple other carriers will continue to ramp, and we anticipate several new awards with US federal defense agencies. We expect the momentum in the US rural broadband segment to continue at similar levels to the third quarter. And we expect a seasonally strong quarter with enterprise customers as we renew annual enterprise license agreements. Our guidance for the fourth quarter projects -over-year sales growth of approximately 8% at the midpoint, reflecting all of these positive trends. We anticipate gross margin to be slightly higher than the notable level we posted in the third quarter due to the expected higher mix of cloud-med sales. Based on this, for the fourth quarter, we're projecting revenue in a range of $235 to $255 million, non-GAAP gross margins in a range of 55.5 to 56%, and non-GAAP adjusted EBITDA in a range of $46 to $52 million. We certainly recognize that our guidance for the fourth quarter implies significant sequential growth, but as I've outlined, we have good momentum across multiple areas, along with strong bookings in the third quarter that provide good visibility and confidence for an excellent finish for the year. Overall, we're making good progress on our key strategic goals, including returning to growth in our telco voice infrastructure business, diversifying and expanding sales in enterprise market verticals, including financial, healthcare, energy, transportation, and government information security, cross-selling the entire portfolio, particularly in the US, and achieving sustainable, profitable growth in our IP optical business, and accelerating innovation and capturing cost efficiencies with the full integration of our chronic teams. Operator, that concludes our prepared remarks, and we can now take a few questions.

Thank you. Ladies and gentlemen, we will now be conducting our question and answer session. If you would like to ask a question, please press star and 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star and 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Christian Schwab with Craig Hallam Capital Group. Please go ahead.

Great. Thanks for taking my question. Good quarter. So, I'm just curious, can you help us on the MetaSwitch opportunity? It seems like you talked about it being substantial and Microsoft kind of walking away from the platform. Is there a dollar install base and a percentage of share that you think is reasonable that you could attain on a go-forward basis? Just any more color regarding how substantial that opportunity might be?

Yes. Hey, Christian. So, there's a couple of different metrics, I think, to look at. There's quite a range. They're deployed in kind of a broad range of smaller regional rural operators and then quite a few of the tier two operators, frankly, places where we're not, they are sort of thing. There's a lot of kind of distribution across the footprint between the two of us. So, these deals can range from a few hundred thousand dollars to several million dollars or larger depending on the scale and the scope. One of the metrics to look at is the last public filings that Microsoft maintains in the UK for that business. Just the ongoing maintenance revenue stream is pretty substantial from that install base. I forget the exact number, but in the 75 million range or more. So, I think it's a fairly substantial footprint. Of course, some of that will just continue to operate the way it is. Some of it will get upgraded and replaced. I can tell you we get a lot of focus on it. It's an opportunity that doesn't come along very often to go and capture some of that real estate footprint.

Great. Then the second question has to do with the BEAT program. Sounds like you're seeing some revenue. OPEA on their conference call talked about recognizing their first revenue in the December quarter. That seems a little bit earlier than a lot of people were thinking given the supposed to all the state approvals. Would you expect that 2025 could be a stronger uptake of movement of spending BEAT dollars or do you think it will be kind of gradual in 2026 as the big year?

I think it's gradual particularly for us given we're not on the access layer of the network. I am kind of pleased to see the progress though over the last few months. I think I was actually doing some reading this morning and I think there are now nine states that have opened up their grant application windows and some are already processing applications. You could even see perhaps the first awards before the end of the year. So, that's good progress compared to where we were say six months ago. Again, I think the first half is pretty modest and kind of getting started on the construction portion of some of these programs and then accelerating in the second half. Again, our piece is a little bit later in the process as they start to build out the interconnectivity in the middle mile portion. It's good to see the progress finally being made here.

Great. Fantastic. No other questions. Thank you.

Thanks, Christian. Thank you. The next question is from the line of Michael Genovese from Rosenblatt Securities. Please go ahead.

Great. Thanks so much. In the current quarter, we will go through all of the geographies and the sentence. There's really, really promising data points. But I guess can I just start by asking where, if anywhere in the quarter, did not go to your expectations? Was there anywhere where you were sort of slightly disappointed by the demand?

Well, I'm really pleased with the profitability, obviously. The mix, the margin, the performance of our services team was really outstanding in the quarter. So it was great to see that come through. Obviously, we were a million and a half or two million below the midpoint of guidance. So we were a couple million shy of where I thought we would be and maybe a few deals in Europe in particular that could have happened in the quarter. Good pipeline for the fourth quarter here, though. Obviously, good momentum and outlook. And the margin makes even a little better in the quarter. So really looking forward to a strong finish.

So following up on that, for the fourth quarter, it really looks like the U.S. is going to be the star again. But you made positive comments about India as well. I guess, how should we think about Europe in the fourth quarter? Should we think about some positive seasonality or is there anything showing fundamental signs of improvement in the fourth quarter in Europe?

Yes, I think the way I described that region is really seasonality, the way you just described it, you know, the combination of critical infrastructure and service providers. The service provider piece tended to be a little more seasonal. So I do think we have a stronger fourth quarter, which we typically do in that region. The U.S. I think will be the strongest region. I think we shifted back to the U.S. being more than 50 percent of revenue in the third quarter and probably the same in the fourth quarter. And, you know, in India, last year we grew substantially. We were up 30 percent last year in India. This year, as I talked about in the last call, we're down about 20 percent compared to last year. But the fourth quarter will be the strongest quarter of the year. So we've continued to improve as the year progressed. And, you know, with Vodafone Idea beginning to reinvest in their network and build out both 4G and 5G infrastructure, that's good for the whole vendor community. So looking forward to, you know, a stronger year going into next year as well there.

That's the last question for me. I mean, this, looking at it from the outside, I mean, I know it's just started, but it looks like maybe the most promising time ever for sort of soft switch architectures in basically your cloud and edge business. And maybe I'm not remembering, you know, well enough sort of, you know, something good that happened 10 or 20 years ago in the market. But I mean, something really fundamental seems to be going on there. Could you, is this the best time ever for cloud and edge and why, if so?

Well, in that portion of that business, it's certainly the best that I've been here. You know, I think we've gone through some fairly major upgrade cycles in this space back, say, seven, eight years ago for kind of the first phase of some of the modern soft switch architectures. You know, there's a lot of focus on pulling cost out of the network operation. And, you know, there's a bit of an issue around aging knowledge-based knowledge workers in this space. And so I think the motivation has really picked up. Of course, the other part of our business in this space is around unified communications, deploying session border controller and policy management to support Microsoft Teams and Zoom and those sorts of migrations. And we've had a number of really strong years around that part. But the whole kind of network infrastructure upgrade process that we're seeing service providers and, you know, U.S. federal agencies go through, it feels pretty unique for sure.

Great.

Thanks so

much. Thanks, Guy. Thank you. Ladies and gentlemen, a reminder, if you wish to ask a question, please press star and 1. The next question comes from the line of Tim Savitore from Northland Capital Markets. Please go ahead.

Hi. Good afternoon and congrats on the quarter. I wanted to follow up on your mid-single digit growth guidance, I guess, for calendar 25 and try and get at some of the moving parts there. Now, obviously, you've seen some declines in IP optical this year. I think you were expecting that to maybe be flat to up. Now it seems like maybe down to single digits. Given U.S. strength, do you expect a strong rebound there? Then again, you've got a lot going on, big orders and big opportunities in cloud and edge. So, I guess, how would you expect the segments to grow around that kind of mid-single digit target? I'll follow up from there.

Yeah. Hey, Tim. Thank you. So, there's a number of moving parts here, obviously, to get to an overall corporate average growth for next year. As you point out, we have been on approximately 10% per year growth rate on the IP optical the last few years. With the Eastern European business suspension that we implemented last quarter, year over year going into 2025, we have to make up, if you will, the shipments that we had in the first part of the year in that region. You can estimate that in the $25 million range. To grow next year in that business, we've got to make up that amount and then grow from there. That gets us to the mid-single digit range around that business. In the cloud and edge business, voice infrastructure business, a portion of our total revenue there is, obviously, maintenance revenue. That tends to be fairly flat year over year. To get to a mid-single digit growth rate around that, we have to grow at a faster rate on the product and service portion. Again, so that the implied growth rate around the product side is actually higher than the mid-single digit range. Between those two pieces of the model, that gets you to an overall average in the mid-single digit range.

Got it. Thanks. I think you mentioned in the release and maybe a little bit on the call about pursuing, obviously, Verizon voice modernization deal and strong growth there, but pursuing opportunities with multiple additional carriers. I think we can talk about pipelines in several different ways here. Maybe you can try and quantify those opportunities relative to what you're able to land with Verizon. I might extend that. You kind of did that with MetaSwitch a little bit, at least through a number out there. If it's possible to look at the opportunities that are emerging on the IP optical side with the Nokia and Finera deal, it'd be interesting to get a sense of that pipeline as well. Address it how you want, but I'm looking for more color on the voice modernization opportunities and then the IP optical opportunities.

Yes. On the first one, it would be hard to find another opportunity of the same scale as the Verizon project. That's certainly the largest in our funnel. We've announced a few other ones that we've been able to talk about publicly, like BrightSpeed we talked about last quarter. They're modernizing some of their legacy voice infrastructure and migrating off of the Lumen infrastructure as part of that separation. I've talked about some of the projects we have going in Africa with operators like MTN putting in a new voice interconnect hub into Africa. There's a number in Europe that we haven't talked about publicly yet that are similar in nature and then others here in the US. Obviously some larger opportunities here to do similar network modernization. I will say that each network is a little bit different. The regions that have deployments in much more rural areas with smaller line counts, those sorts of things, maybe the ROI on upgrading those types of switching platforms isn't there. It makes more sense just to operate them as long as you can, but there's larger ones where it does make sense and there's a good ROI. There's a good pipeline of those types of additional service provider opportunities in both North America and in Europe that we're pursuing and will be lined up for next year. Of course you add to that the US federal that I commented on quite a bit around those types of opportunities. Very similar, they're building out their own secure communication infrastructure. The DISA project that we announced in the third quarter, basically replacing and modernizing that soft switch backbone that operates the DoD basically interconnect network for voice communications. Yeah, just a good pipeline of those types of opportunities that are driving growth for the business. The other part of your question around the IP optical pipeline and comment on the competitive environment. Certainly as we saw in the third quarter here with 20% of our revenue in the US for the first time, we're having good success particularly in the regional and rural operators helping build out and add more capacity into the network. We've got a good pipeline for fourth quarter and I think those programs continue into next year. Then as the BED funding actually starts to move into our portion of the network, I think that is our 26, 27 opportunities for us. So, good runway going forward there. The other area we haven't talked too much about in the US is around critical infrastructure. That's a real platform for our business in Europe, has not been a big driver so far here in the US. We announced American Electric Power earlier this year, sixth largest energy transportation company here in the US that build out their own secure transport and IP routing network. We're having a really good program with them this year helping modernize some of that. So, those are some of the other kind of related opportunities. The Nokia Infineira opportunity specifically I think takes a little longer time to develop. It's not so much in North America. The opportunities we see are more in Asia pack and in Europe to some extent. Typically, it's an operator that has either both of them deployed in the network today or were perhaps migrating in a particular direction and for whatever reason aren't sold on the combined roadmap or the strategy there. I think the window of time is between now and when that closes and they bring together a clearer roadmap. So, while that uncertainty is in the market, we're really hustling to go try and find some new wins in that space.

Great. And last one from me real quick. What could Verizon acquiring Frontier mean for you guys from a voice perspective?

Yeah, I think that's a real opportunity. I haven't been able to quantify it yet, but we don't do a lot of voice business there today with Frontier other than some maintenance. They haven't invested a lot in modernizing that portion of their network. There's been a lot of focus, obviously, on driving fiber very successfully. I think there's a good possibility Verizon will look at a similar playbook as they look at the Frontier infrastructure. We won't know that until they're further along in the process, but that's certainly something as we look into say the 2026 timeframe that could be a further catalyst for us.

Thanks a lot. Thanks, Tim. Thank you. The next question is from the line of Trevor Walsh from Citizens JMP. Please go ahead.

Hi, this is Russ on for Trevor Walsh at Citizens JMP. Thanks for the question. In regards to the impressive triple digit growth rate year over year in IP optical, aside from the cited rural broadband fiber initiatives, you guys talked about the fixing of the success with the cross-sell motion. Could you just unpack what's kind of driving that success there?

Yes, I guess two thoughts on that. The rural portion of the business we think of as cross-sell. Many of these customers, we actually have an installed base of voice infrastructure with them already today. They're not investing a lot in that, but it's an ongoing support and maintenance and commercial relationship with them. They rely on us to help operate that network. It's given us a bit of an unfair advantage in some ways to be able to go in and compete for this new business as they're investing in these new areas. Many times the decision makers are the same people that we work with already on the other part of the business. That part of the cross-sell has really worked well. The other part is really being able to use the IP routing technology, the routing platforms that we have to be able to do replacement of TDM and SONNET infrastructure with a broader set of service provider customers. We have a pretty active base now of customers that provide interconnect services in the US between the different operators that help interconnect both data traffic and voice traffic. The cost of these interconnect networks, these traditional TDM networks and SONNET networks is going up every year disproportionately. There's been a lot of interest in using our routers as basically a replacement for doing circuit emulation. Again, that's a great example of cross-sell where we've got a new technology, a new platform that we're going to existing customers and selling into the new space. Several examples like that, Russ, that we're focused on.

That's great. Thanks, Bruce. I think we heard a lot of answers on MetaSwitch and Infoneira, but I just wanted to touch on the third competitive dynamic. Any revised thoughts or updates around the HPE Juniper?

There hasn't been a lot of new news, if you will, there. Juniper's position in the customer base that we're in today is relatively modest compared to Cisco, Nokia and Huawei. There's a few that are in the pipeline there or a couple of smaller wins, Russ, in that space, but not dramatic, so I didn't comment on this go-round.

Great. Thank you so much.

Thank you. Thank you. As there are no further questions, I now hand the conference over to Mr. Bruce McClellan for his closing comments. Bruce?

Yes, thanks very much, Ryan. Thanks again for everybody being on the call and for your interest in ribbon communications. We look forward to speaking with many of you in our upcoming investor conferences and keeping you updated on our progress. Operator, thanks very much. This concludes our call.

Thank you. The conference of ribbon communication has now concluded. Thank you for your participation. You may now disconnect your lines.